Nokia Buys Siemens Stake in Joint Unit for $2.2 Billion

Nokia Oyj agreed to buy Siemens’s share in a six-year venture for 1.7 billion euros ($2.2 billion), giving the Finnish company full access to the phone-equipment maker’s cashflow for a less-than-estimated price.

Nokia will pay 1.2 billion euros for Siemens’s 50 percent stake in Nokia Siemens Networks, with the remainder as a secured loan from Siemens due a year after the deal is completed. Nokia doesn’t plan to integrate Nokia Siemens and may still decide to seek partners, Chief Executive Officer Stephen Elop said. The Finnish handset maker fighting to come back in the smartphone industry jumped as much as 10 percent in Helsinki trading. The purchase price values the venture, which became profitable last year, at 3.4 billion euros, less than at least 5 billion euros projected by Hannu Rauhala, a Helsinki-based analyst at Pohjola Bank. Siemens has been seeking to exit wireless-gear manufacturing to focus on energy equipment, healthcare and infrastructure projects.